A good starting point for property-tax reform

The wheels of justice have nothing on property tax reform and education funding in this state.

Both grind away at a snail’s pace.

In the meantime, senior citizens and others on fixed incomes struggle to meet the bane of the Pennsylvania homeowner, the yolk of paying for public education on the backs of those who deign to own property.

With the state preparing for a battle royal of an election in which a bevy of Democrats are running to unseat Gov. Tom Corbett, it’s not surprising that education funding is zooming to the top of the list of hot issues in the race. Corbett is taking heat for the austere budgets in his first three years in office, ones that squeezed local education funding. The governor insists he’s gotten a bad rap, saying that the real culprit in recent education funding crises are local school boards who ignored warnings not to use federal stimulus funds for recurring projects. When the federal money dried up, the local boards hit up taxpayers to make up the difference.

Advertisement

Everybody agrees education funding is a critical issue. That’s the easy part. Where to get it is a little harder. There is a growing push to tap into the state’s burgeoning Marcellus Shale regions for new revenue. And it’s not just Democrats. Tom McGarrigle, the Republican chairman of the Delaware County Council and state Senate candidate in the 26th District, is proposing a 4 percent levy, with all of that money earmarked for education. State Treasurer Rob McCord, a Democratic candidate for governor, wants to hit the natural gas drillers with a whopping 10 percent extraction tax.

Corbett remains steadfast against any such move, fearful that it will drive the drillers – and the economic boom – out of the state.

This week the heat on property tax reform will be cranked up even more, with the possibility that the state Senate will vote on Senate Bill 76, which would eliminate property taxes. The bill’s sponsor, Sen. David Argall, R-Schuylkill County, believes he has the votes to pass the measure, which would make up the revenue from property taxes by hiking both the personal income tax and sales tax. The income tax would go to 4.34 percent, from the current 3.07, while the sales tax would inch up to 7 percent from the current 6 percent levy.

As you might expect, not everyone is a fan. State business groups have lined up against the plan, wary of the hit small businesses would take in terms of the sales tax.

This week, not terribly surprisingly, the Pennsylvania School Boards Association blasted the bill in advance of the expected vote.

The state did not get in this mess, seeing the state’s portion of education spending fall from 50 percent in the mid-1970s to where it stands today, a miserly less than 34 percent. That leaves Pennsylvania in a lowly 47th position nationwide in education funding. Getting out of this hole will not be easy, or without pain. In addition, the focus on revenue does nothing to address the many underlying causes of soaring education tabs, things like state mandates, pension costs, special education and charter school issues.

Not helping in the least was news this week that the state’s finances were less than rosy. In fact, despite the governor’s constant trumpeting of an economic turnaround, the state is in the red, staring at a $1 billion deficit. Corbett’s budget proposal calls for 3.7 percent more spending, with much of that money earmarked for a new grant program for public schools, and feeding the public pension crisis. That pension saga, which Corbett has referred to as a “tapeworm” in the budget process, threatens to derail the entire budget process, leaving public school administrators with skyrocketing costs, which could end up in the lap of taxpayers.

All of which leaves us a bit mystified as to why Corbett and state officials abandoned an important shift in how education funds were allocated a couple of years ago. The result of a costing-out study, did something not always popular in Harrisburg, directing money where it was needed most. In other words, to ailing districts like so many here in Southeastern Pennsylvania hit hard by increasing poverty levels, with a large population of English as Second Language learners, and struggling to keep pace with special education and charter school costs.

Act 61, which stemmed from the costing-out study, included a formula to more equitably allocate funding. Unfortunately, fearful of the cost, the formula was only in place for a few years when Corbett pulled the plug.

The governor this year has gone on record as saying he believes the state is in dire need of “ a true, fair funding system” for educating the state’s children.

We couldn’t agree more, and we’ve been saying so for months.

Might we make this one small suggestion?

Why not use as a starting point returning to the funding formula already put in place by the costing-out study and Act. 61. It proved effective in getting more money into the hands of those districts that needed it most.

The property tax reform questions are not going away any time soon. This would be a good place to start.